Fertiliser Boss Says War Threatens Global Food Supply

Fertiliser boss says war puts 10 billion – The ongoing conflict in the Gulf region, which has disrupted shipping routes through the Strait of Hormuz, is endangering the global availability of fertiliser and its essential components, according to Svein Tore Holsether, the head of Yara, one of the world’s leading fertiliser producers. Holsether warned that the situation could lead to a significant reduction in food production, with estimates suggesting up to ten billion meals being lost weekly. This disruption would disproportionately affect the most economically vulnerable populations, he emphasized.

Global Impact of Fertiliser Shortages

Yara’s CEO highlighted that the war has already caused a halt in the production of half a million tons of nitrogen fertiliser globally. This shortage, he explained, has serious consequences for agricultural output, as nitrogen is a critical nutrient for crop growth. Without sufficient fertiliser, yields for certain staple crops could decline by as much as 50% in the first season, he said. Such a drop would create a ripple effect across food systems, potentially triggering competition for limited resources among nations.

“We’re seeing a global reduction in nitrogen fertiliser production due to the current geopolitical tensions. This means that food production is under threat, and the impact will be most severe for countries with fewer resources to adapt,” Holsether stated.

The disruption in fertiliser supply is not just a local issue but a worldwide crisis, as shipping bottlenecks in the Gulf have limited access to key ingredients like ammonia and urea. These materials are vital for manufacturing fertiliser, and their scarcity has forced farmers to cut back on usage. Holsether noted that while some nations may weather the storm, the consequences for poorer countries could be devastating.

Price Wars and Food Affordability

As the cost of fertiliser has surged by 80% since the conflict began, Holsether warned that this increase could lead to a price war for food between wealthier and less affluent nations. “If the conflict continues, we’ll face a scenario where rich countries outbid poorer ones for food supplies, pushing up prices for the most vulnerable,” he said. This situation would exacerbate existing challenges, as developing nations often lack the financial cushion to absorb higher costs.

“Higher energy costs, increased diesel prices for tractors, and rising input expenses are all putting pressure on farmers. Yet, the prices of crops have not yet matched these costs, creating a financial strain,” Holsether added.

He urged European countries to consider the broader implications of their energy and trade policies, particularly in regions where food is a basic necessity. “Europe may be able to afford higher food prices, but we need to ask: who is losing out when we secure our own supply? It’s the people in developing nations who can’t afford to pay more,” he cautioned. The Yara boss also linked the fertiliser crisis to issues of food affordability, scarcity, and hunger, stressing that these factors could intensify in the coming months.

Challenges for Farmers and Consumers

Farmer profitability is currently under threat as input costs rise sharply. Holsether pointed out that while food prices have increased, they have not kept pace with the inflation in fertiliser and energy. “Tractors are more expensive to operate, and the cost of fuel has gone up dramatically. These are direct hits to farmers’ margins,” he explained. The situation is compounded by the fact that crop yields are still being affected, which could lead to a further contraction in food supply.

“The most vulnerable people in developing countries will bear the brunt of this crisis. They can’t afford to pay higher prices, so their access to food will shrink,” Holsether said.

He also highlighted the interconnected nature of global food systems, where a shortage in one region can ripple across the world. “Even if one country manages to secure its own food supply, others may struggle. This creates a situation where the most vulnerable are left behind,” he argued. The CEO called for a coordinated international response to ensure that food remains accessible to all, regardless of economic status.

UK Food Inflation and Broader Implications

Although the UK is not expected to face immediate food shortages, the cost of producing food is on the rise. Holsether noted that these increased expenses are likely to be passed on to consumers, leading to higher weekly food bills. The Food and Drink Federation recently projected that food inflation could reach 10% by the end of the year, a forecast that aligns with the concerns raised by Yara’s leadership.

“If the war continues, we’ll see a bidding war for food. Europe may be able to manage it, but we need to think about who we’re displacing in the process. It’s a question of fairness in the global food market,” Holsether said.

Experts warn that the combined effects of energy and fertiliser price hikes could have long-term consequences for global food security. While the immediate impact may be manageable for wealthier nations, developing countries with limited resources may face severe challenges. Holsether urged policymakers to consider the long-term implications of their decisions, particularly in regions where food insecurity is already a pressing issue.

The fertiliser crisis also raises concerns about the sustainability of current agricultural practices. With nitrogen fertiliser being a cornerstone of modern farming, its scarcity could force a shift toward alternative methods, such as organic farming or reduced reliance on chemical inputs. However, these changes may take time to implement and could initially lower crop productivity, further straining food supplies.

As the conflict in the Gulf persists, the global food supply chain faces an uncertain future. Holsether’s warnings underscore the need for proactive measures to mitigate the impact on vulnerable populations. He called for increased investment in fertiliser production, better coordination between nations, and policies that protect food affordability. “We’re at a critical juncture, and the choices we make now will determine whether this crisis becomes a lasting problem or a temporary setback,” he concluded.

For now, the focus remains on the immediate effects of the fertiliser shortage. With prices expected to remain high and supply constraints likely to continue, the global food market is in for a challenging period. The Yara boss’s insights provide a stark reminder of the delicate balance between geopolitics and food security, highlighting how a single conflict can disrupt billions of meals and affect millions of lives worldwide.